Favorite Schools

Favorite Teams

Bath salts kingpin John Tebbetts begins prison term still owing state $1.5 million

Tebbetts, court

John Tebbetts before County Court Judge Anthony Aloi (not shown) earlier this year. Tebbetts pleaded guilty July 25 to not paying more than $616,000 in sales and income tax.
(Douglass Dowty | ddowty@syracuse.com)

His sentence for grand larceny and criminal tax fraud will be served at the same time as his federal sentence, said his lawyer, Donald VanStry.

But the biggest issue in his state case was how much money Tebbetts would have to pay back to the state. Tebbetts initially repaid $150,000, and will be required to pay back the remainder of the $616,000 now.

Interest and penalties imposed by the state, which are nearly triple that amount, won't be required until after he leaves prison, VanStry said.

In what could be a theoretical problem, the interest and penalties continue to grow while Tebbetts is in prison, VanStry said. The state judgment against Tebbetts in seven years will be significantly more than $1.5 million.

But the state can only collect what Tebbetts can pay. His plan will be to restart his wholesale business of supplying legal products to head shops, VanStry said.

Eventually, Tebbetts can try to work out a settlement with the state for the rest of the money. Under law, for example, the state can waive about half of the debt, VanStry said. But that's all down the road.

For now, Tebbetts will spend seven years in federal prison for selling illegal bath salts. (He maintains they became illegal so quickly he didn't realize he was breaking the law before being arrested in December 2012, his lawyer said.)

In any case, he will leave prison still owing the state millions of dollars.